Bloc 11 & Diesel Cafe

When Diesel opened in 1999, it seemed as though the fresh juice and beverage industry was on the brink of something big.  People were starting to be more conscientious of what they were eating and drinking and being more aware of where those products came from.

Ever since we started Diesel and Bloc, we have been attracted to working with like-minded vendors.  Businesses that care and have some heart, businesses that seem to have some connection to their community, businesses that have some investment in their employees, businesses that care about the environment and sustainability.  For the first few years that we were open, it seemed as though the beverage industry was an area where aligning ourselves with these kind of businesses was a no-brainer.  There was Fresh Samantha, started by a guy who named his company after his daughter.  And then there was Odwalla, a similar company started by three folks on the West Coast that wanted to distribute fresh juice to local supermarkets.  Naked Juice is another  story of a vision, a juicer, a truck, and local distribution.

All three of these companies also share a simliar story of growth, development and aquisition.  In 2000, Odwalla purchsed Fresh Samantha for $27 million in stock.  A year later, in 2001, Coca-Cola purchased the joint companies for $181 million as part of their Minute-Maid division.

Disenchanted with Coca-Cola, we were more than enthusiastic when approached by a new up and coming juice company, Naked Juice.  We discontinued Odwalla/Coca-Cola and made the switch to exclusively carry Nakeds.  And then, in 2006, Naked was acquired by Pepsi which had recently bought out Stacy’s Pita Chips and Izze’s Sodas in an attempt to branch out into the natural food and beverage market.

Certainly, what Coca-Cola and Pepsi can boast as an intelligent business model is that they have not put all their eggs in one basket.  Having their hands in many different and even competing arenas allows them safety nets from falling victim to the next “trend”.

The Question that I pose is: why?  Why does this seem to be the natural progression of growth in business?  And what does that mean for our future?  How do we grow in a way that is in keeping with our original mission?  Does profit equal selling out?  Does selling majority or all shares in your business have to mean that you are selling out?

Opening a second store was a big deal for us because of this very issue, and the main reason that Bloc11 is NOT Diesel or Diesel 2.   For the past decade, Tucker and I have spent close to every single day in Diesel’s 4 walls, in sync with our staff, our customers, and our community.  A second store threatened those connections and we feared that eventually, we would turn into just another coffee conglomerate named after constellations and money.  But after about a year, what we have learned is that while it is different,  we have widened our network and our communities.  We employ close to 50 people, have an even larger customer base and have still managed to create, maintain and develop  meaningful ties.  And what I think about as we grow and grow up, is that Tucker and I are guided by what is important to us.  Not that it is always clear what that is, our what the path is to that goal, but we have always gone with what feels right.  So, I hope that in the next decade, we can continue to be motivated and steered by what is right for us and the people we care about at that moment in time.

In 1998, when we decided to open Diesel Cafe in Davis Square, this Starbucks was not there.  In fact, many of the Starbucks that we are used to seeing line the streets, were not there.   This space directly across the street from us lay vacant for a number of months after Papa Gino’s closed their doors.  We even contacted the landlord at some point to introduce ourselves.  When I explained to him what we were doing, he laughed and said, “That is a stupid idea, you know?”  8 months later, he rented to Starbucks.

When we opened in May of 1999, we were one of many independently owned cafes in Davis Square (The Someday, Salt and Pepper Bakery, and Carberry’s) .  The abundance and concentration of cafes in the square was actually one of the appeals for us.  We had looked in Central Square, which also boasted a handful of eclectic coffeehouses, for close to 2 years with no luck.  When we were close to giving up the search for a space, we opened the Boston Globe classifieds to a space in Somerville.

About 6 months after Diesel opened, we learned that a Starbucks was getting ready to open across the street.  We had just invested everything we had, borrowed more money than we could ever imagine making back, and put even more money on credit cards that no bank in their right mind should have ever let us have.  Needless to say, the prospect of being “put out of business” and “bankrupt at 21″ was enough to keep me awake at night devising schemes that centered around arson or shattered glass or both.

The first couple of weeks that the Starbucks was open, I remember someone threw paint at the building across the windows, someone spray-painted their windows and someone finally just threw a rock through the windows.  I remember thinking how awful I would feel if someone ever did that to our store.  And I remember thinking, I bet they think that it was us.  I also remember thinking, what is the point?

Here are some things that Starbucks has taught me over the years:

1.  Tall is small.
2.  Grande is medium.
3.  Hating on the competitor does not help your company do a better job.
4.  Staying in touch with the competitor can help your company.
5.  Competition is relative. Our friend and founder of Intelligentsia, Doug Zell, likes to say that Intelligentsia does not compete with anyone but themselves.  I also find assurance and agony in the knowledge that we can do so much better.
6.  Starbucks reminds us of what we don’t want to be.
7.  As a good friend recently said, “Coffee companies should not try to get involved in the music industry”.  Check.
8.  Starbucks provides the public with something that we cannot. That is a good thing. Options and choices are important.
9.  A logo is only as powerful as the branding behind it.  Green mermaids?
10. If nothing else, Starbucks provides a good point of reference and reflection. What is it that people like from Starbucks? What do they offer that we, as a community value, respect, appreciate? What does it say about our community that there are so many of these stores all over the world?